METRO GROUP Roadshow. Luxemburg, 8 September 2015

Transcription

1 METRO GROUP Roadshow Luxemburg, 8 September 2015

2 DISCLAIMER AND NOTES To the extent that statements in this presentation do not relate to historical or current facts, they constitute forward-looking statements. All forward-looking statements herein are based on certain expectations and assumptions at the time of publication of this presentation and are subject to risks and uncertainties that could cause actual results, performance or financial position to differ materially from any future results, performance or financial position expressed or implied in this presentation. Many of these risks and uncertainties relate to factors that are beyond METRO GROUP s ability to control or estimate precisely. The risks and uncertainties to which these forwardlooking statements may be subject include (without limitation) future market and economic conditions, the behaviour of other market participants, investments in innovative sales formats, expansion in online and multichannel sales activities, integration of acquired businesses and achievement of anticipated cost savings and productivity gains, and the actions of government regulators. Readers are cautioned not to place too much reliance on these forward-looking statements. See also Risk and Opportunity Report on pages of the METRO GROUP Annual Report 2013/14 for risks as of the date of such Annual Report. METRO GROUP does not undertake any obligation to publicly update any forward-looking statements or to conform them to events or circumstances after the date of this presentation. This presentation is intended for information only. It is not intended as an offer for sale, or as a solicitation of an offer to purchase, any securities in any jurisdiction. This presentation may not be reproduced, distributed or published without prior written consent of METRO AG. All numbers are before special items, unless otherwise stated. The consolidated financial statements have been prepared in euros. All amounts are stated in million euros ( million) unless otherwise indicated. Amounts below 0.5 million are rounded and reported as 0. Since 2012, only the amounts in the income statement, the reconciliation from profit or loss for the period to total comprehensive income, the balance sheet, the statement of changes in equity and the cash flow statement were rounded to produce the respective totals. In all other tables, the individual amounts and the totals were rounded separately. This may entail rounding differences. Due to the sale to Hudson s Bay Company, Galeria Kaufhof will no longer be shown as a separate segment, but as a discontinued operations. Accordingly, METRO GROUP's financials have been recalculated to account for the disposal of Galeria Kaufhof and the previous year's figures have been adjusted. The sale is scheduled to close in September September 2015 METRO AG

3 AGENDA 01 Latest METRO GROUP 3 02 METRO a Glance Three Market Leading Sales Lines Performance in Q3 2014/15 & Outlook FY 2014/ Key takeaways 32 8 September 2015 METRO AG

4 METRO CASH & CARRY: ACQUISITION OF CLASSIC FINE FOODS, AN FSD PLAYER IN THE PREMIUM SEGMENT IN ASIA (I) Leading FSD player in the high-margin premium segment: Access to high growth markets Unique service offering Highly niche premium product portfolio Presence in 25 mainly Asian cities across 14 countries UK ~6,000 active customers with focus on HoReCa customer group France China Japan Korea c. 800 full-time employees Financials 2014: sales US$219m EBITDA US$18m (margin 8%) UAE Thailand Hong Kong Philippines Vietnam Malaysia Singapore Indonesia 8 September 2015 METRO AG

5 0k 0k 0k 0k 0k 0k METRO CASH & CARRY: ACQUISITION OF CLASSIC FINE FOODS, AN FSD PLAYER IN THE PREMIUM SEGMENT IN ASIA (II) Hotel Restaurants Others 1. HIGHLY ATTRACTIVE PREMIUM FSD BUSINESS MODEL FOR STRONG IMPROVEMENT OF FSD COMPETENCE CFF extends METRO s FSD capabilities to widen service for its HoReCa customers 2. EXPANDING WHOLESALE OPERATIONS FROM 26 TO 36 COUNTRIES FUELLING FUTURE SALES AND EARNINGS GROWTH Superior sales growth (CAGR FY 10-14: 15%) and EBITDA margin (8%) compared to FSD peers and Cash & Carry segment CFF sales (in US$m) TOP MANAGEMENT TEAM TO LEVERAGE SYNERGY POTENTIAL Further growth potential by expanding CFF in selected European MCC markets A 2011A 2012A 2013A 2014A Source: Company Information 8 September 2015 METRO AG

6 MEDIA-SATURN: ACQUISITION OF RTS GROUP, A FULL-SERVICE & REPAIRS PROVIDER FOR ELECTRONIC PRODUCTS (I) Full-service and repairs provider for electronic products Founded in 1989 by Josef Raith Headquartered in Wolnzach, Bavaria Further locations in Germany: Augsburg, Nürnberg, Regensburg, Sömmerda, Straubing Cooperation with > 50 service partners across Europe Around 1,200 employees Financials 2014: Sales ~ 136m; EBITDA ~ 8 m. CE service & repairs Multiple device repairs and customer service solutions Technical after-sales service (Profectis) Only on-site (home) service provider for white goods covering the whole of Germany Warranty-buy-out Smart home installations Smart home installations and support in-store and on-site (home/b2b) Spare parts Spare parts logistics & management Online spare parts sales B2B/B2C 8 September 2015 METRO AG

7 MEDIA-SATURN: ACQUISITION OF RTS GROUP, A FULL-SERVICE & REPAIRS PROVIDER FOR ELECTRONIC PRODUCTS (II) Deal rationale for MSH Acquisition enables MSH to transform from a transaction-/product-driven CE retailer to a customer-solution-focused CE retailer Added value service throughout the entire customer journey (beyond the buying process) Dedicated service offering as a new product Consistent quality standards From a single source Valuation and deal structure Sellers: Josef Raith (Founder) & Capiton AG Share deal In a first step, acquisition of 90% of the shares Full exit of Capiton AG Founder Raith to keep 10% of the shares Transaction subject to approval by the cartel offices Unique opportunity to work with suppliers on backend process optimization, service and repairs 8 September 2015 METRO AG

8 GALERIA KAUFHOF: KEY TRANSACTION FACTS Disposal of department store operations in Germany and Belgium together with the related real estate portfolio to Hudson s Bay Company Enterprise value of 2.825bn Substantial assurances for around 21,500 employees, HQ and stores Significant reduction in rating-relevant 1 net debt by c. 2.7bn, including cash inflow of c. 1.6bn Net book gain on sale of c. 0.7bn Closing expected by end of FY 2014/15 1 Standard & Poor s methodology 2 before special items million Germany Belgium Total FY Sales 2013/14 2, ,099 FY EBIT 2013/ Stores per 31/3/ September 2015 METRO AG

9 GALERIA KAUFHOF: USE OF PROCEEDS FROM SALE Increase overall capex budget to ca. 2bn over the next few years Intensify investment activity Growth countries (METRO Cash & Carry and Media- Saturn) Store remodellings and new store formats in inner city locations (METRO Cash & Carry and Media- Saturn) Complementary assets to accelerate growth in Cash & Carry (FSD) and Media-Saturn (multi-channel) Digital penetration of the HoReCa sector (METRO Cash & Carry) Strengthen financial profile RoCE* 2013/14 vs. Cost of Capital * lease-adjusted 8 September 2015 METRO AG

10 SUCCESSFUL PORTFOLIO STREAMLINING AND FOCUS ON CORE OPERATIONS & Saturn France MAKRO Cash & Carry UK MAKRO Cash & Carry Egypt & Greece METRO Cash & Carry Morocco Media-Markt China Real Eastern Europe & METRO Cash & Carry Denmark & Vietnam *) Booker stake Real Turkey GALERIA Kaufhof *) Vietnam pending Disposals Freeing up capital to focus on and grow the core business and strengthen the balance sheet 8 September 2015 METRO AG

11 AGENDA 01 Latest METRO GROUP 3 02 METRO a Glance Three Market Leading Sales Lines Performance in Q3 2014/15 & Outlook FY 2014/ Key takeaways 32 8 September 2015 METRO AG

12 ONE OF THE LARGEST RETAILERS IN THE WORLD Sales: 60 billion EBIT: 1.5 billion Stores: 2,063 Countries: 31 Employees: 230,000 DATA BASE: FY 2013/14 ADJUSTED FOR GALERIA KAUFHOF 8 September 2015 METRO AG

13 THREE MARKET LEADING SALES LINES METRO AG The world s leading player in the cash & carry sector Europe s No. 1 consumer electronics Retailer One of the leading operators of hypermarkets in Germany 2013/14 Sales Share 51% 35% 14% 2013/14 EBIT Share* 73% 22% 5% Business Innovation Real Estate Portfolio * Pre Other and consolidation 8 September 2015 METRO AG

14 STRONG INTERNATIONAL PRESENCE Germany Western Europe Eastern Europe Asia/Africa METRO GROUP Countries /14 Sales Share 37% 32% 25% 6% 100% We generate approximately 30% of Group sales in emerging markets 8 September 2015 METRO AG

15 FY 2013/14* ALL TARGETS ACHIEVED Major challenges Sluggish economic environment Geopolitical crisis Weak emerging market currencies Major achievements Consequent focus on our customers in terms of Assortment Services Solution Competences Improved company culture Active portfolio management Better sales, higher earnings, stronger balance sheet * Includes Galeria Kaufhof LFL Sales EPS Net Debt Dividend +0.1% +25% to bn to 4.7bn 0.90 per ordinary share 8 September 2015 METRO AG

16 AGENDA 01 Latest METRO GROUP 3 02 METRO a Glance Three Market Leading Sales Lines Performance in Q3 2014/15 & Outlook FY 2014/ Key takeaways 32 8 September 2015 METRO AG

17 THE WORLD S LEADING PLAYER IN THE CASH & CARRY SECTOR Focused on B2B self-service wholesaling to 3 customer groups: HoReCa, Trader and SCO High performance internationally replicable concept International share of sales of 84% 766 stores in 28 countries Profitable Growth Drivers: Outstanding freshness & quality in food Dedicated sales force Innovative store concepts Delivery Own brands Expansion Focus on Russia, China, India and Turkey million FY 2012/13 FY 2013/14 Sales 31,165 30,513 RoCE 15.7% 13.3% EBIT 1,379 1,125 EBIT Margin 4.4% 3.7% 8 September 2015 METRO AG

18 STRATEGIC AMBITIONS Being the Champion for Independent Business Strong differentiation through exceptional food competence Development and roll-out of innovative wholesale concepts Ongoing cost structure review Overall Ambition: Market Leadership in well defined sectors through unique product ranges and strong focus on B2B solutions that make our customers more competitive 8 September 2015 METRO AG

19 MCC S NEW OPERATING MODEL FOSTERS ENTREPRENEURSHIP Our new approach includes: Countries are fully empowered for value creation Certain functions are shared based on common needs Utilization of best practices and expertise will be increased Commercial Intelligence is close to operations The center takes an active ownership approach through Operating Partners with much higher proximity to the business and much more intensive interactions Effectiveness and intensity of leadership grow 8 September 2015 METRO AG

20 MAJOR CHANGES EXPECTED From past to new operating model Standard approach across all countries Significant localization based on country situation Multi project management across all countries Dedicated focus on locally selected CTGs and selected key initiatives Heavy expansion across many countries Focused expansion in selected countries Most international country portfolio Optimized portfolio to create value Classic planning and budgeting process Value Creation plan as the central steering component 8 September 2015 METRO AG

21 ESSENCE OF OUR NEW OPERATING MODEL Our Aspiration: Increase effectiveness & proximity 8 September 2015 METRO AG

22 EUROPE S NO. 1 IN CONSUMER ELECTRONICS RETAILING Pan-European market leader with 986 stores in 15 countries and online presence Large-scale, full assortment store base with entrepreneurial store managers Very competitive EDLP pricing strategy Innovative merchandising and marketing concepts Profitable Growth Drivers: Business model transformation Multi-channel sales activities in 14 countries Online sales Own brands million FY 2012/13 FY 2013/14 Sales 21,053 20,981 RoCE 15.5% 14.9% EBIT EBIT Margin 1.4% 1.6% 8 September 2015 METRO AG

23 STRATEGIC AMBITIONS Continue transformation to seamless multichannel approach Enhance position as partner of choice for suppliers Further improving cost position: Target cost ratio of 19% Overall Ambition: Media Markt and Saturn: Europe s leading seamless shopping experience in consumer electronics Redcoon: Europe s leading online pure player with a big product range and the lowest prices 8 September 2015 METRO AG

24 LEADING OPERATOR OF HYPERMARKETS IN GERMANY Following the divestment of activities in Eastern Europe and Turkey focus is on Germany with 307 stores Food accounts for approx. 75% of sales Comprehensive product range of 80,000 different articles Member of Germany s leading loyalty card programme PAYBACK Profitable Growth Drivers: Store remodellings Own brands Entrepreneurial store management Multichannel activities: Webshop with more than 20,000 products million FY 2012/13 FY 2013/14 Sales 10,366 8,432 RoCE 5.8% 4.1% EBIT EBIT Margin 1.4% 1.0% 8 September 2015 METRO AG

25 STRATEGIC AMBITIONS Capturing market share by offering best customer propositions Extending own brand offering and multichannel activities Continuing remodeling program Strict cost control Overall Ambition: Unique choice and quality in food retail complemented by a compelling non-food range. Well-adjusted to serve our key customer groups. Enhanced through multichannel. 8 September 2015 METRO AG

26 AGENDA 01 Latest METRO GROUP 3 02 METRO GROUP at a Glance Three Market Leading Sales Lines Performance in Q3 2014/15 & Outlook FY 2014/ Key takeaways 32 8 September 2015 METRO AG

27 Q3 2014/15: SALES AND EBIT BY DIVISION Δ million Sales Q3 2014/15 Change Like-for-Like Change EBIT Q3 2013/14 EBIT comparable Q3 2013/14 EBIT Q3 2014/15 Q3 2014/15 vs Q3 2013/14 comparable METRO Cash & Carry 7, % 0.1% Media-Saturn 4, % 0.2% Real 1, % -3.7% Others/Consolidation METRO GROUP 13, % -0.4% 253 ~ Germany and Western Europe with improved LfL sales development vs. Q2; EBIT down due to Easter shift Positive LfL sales growth despite FIFA World Cup last year supported by good development in Eastern Europe; EBIT further improved LfL sales development needs to be seen in the context of a strong Q3 2013/14 (+5.1%); EBIT positive driven by strict cost control and sound margin development in some categories Others Lower gains from real estate disposals vs. last year 8 September 2015 METRO AG

28 Q3/9M 2014/15 INCOME STATEMENT (EBIT TO EPS) million Q3 2013/14 Q3 2014/15 9M 2013/14 9M 2014/15 EBIT ,127 1,076 Net financial result EBT Income Taxes Profit or loss for the period from continuing operations Profit or loss for the period from disconinued operations Profit or loss for the period EPS in from continuing operations EPS in Ongoing improvement of net financial result driven by lower net debt and interest level The high tax rate in Q3 results from our integral approach thus the adjustments for the 9M period affect Q3 Tax rate for continuing operations of 56.6% in 9M 2014/15 (9M 2013/14: 56.8%) in line with expectations 8 September 2015 METRO AG

29 APPRECIATION OF EBIT 9M 2014/15 in million ,127 ~-100 ~1,027 1,076 ~60 1) ~30 1) M 2013/14 (Reported) Special Items 9M 2013/14 (Before Special Items) Negative FX Impact 9M 2013/14 (Comparable Before Special Items) 9M 2014/15 (Reported) Special Items 9M 2014/15 (Before Special Items) 1) Real Estate Gains from Divestments 8 September 2015 METRO AG

30 9M 2014/15: OTHER KEY FINANCIALS 9M 2013/14 million reported 9M 2013/14 9M 2014/15 Change Net debt (as at 30/06) 5,795 5,530 5, Net working capital (as at 30/06) -1,776-1,982-1, Change in net working capital (cash flow impact) Cash flow from operating activities Capex Number of new store openings Net debt further reduced by around 0.4bn to 5.1bn due to portfolio optimization and real estate divestments Net working capital and cash flow from operating activities impacted by FX and negative NWC development at Media-Saturn, cash flow additionally impacted by higher tax cash out Capex of 656m mainly invested in modernisation, expansion and remodellings 8 September 2015 METRO AG

31 OUTLOOK 2014/15: FINANCIAL TARGETS billlion Reported FY 2013/14 3 Guidance FY 2014/15 Sales growth % >0% LFL sales growth +0.1% >0% EBIT before special items 1,531 >1,531 2 Capex 1.0 ~1.5 Net debt 4.7 <3.2 Number of new store openings 68 ~50 1 Adjusted for portfolio changes 2 Based on constant foreign exchange rates 3 Adjusted for Galeria Kaufhof 8 September 2015 METRO AG

32 AGENDA 01 Latest METRO GROUP 3 02 METRO a Glance Three Market Leading Sales Lines Performance in Q3 2014/15 & Outlook FY 2014/ Key takeaways 32 8 September 2015 METRO AG

33 METRO GROUP S TRANSFORMATION IS ON TRACK CUSTOMER VALUE clearly in focus, relevance further increased BUSINESS MODEL UPGRADE on track and to be intensified EFFECTIVENESS enhanced with new Operating Model (MCC) Successful PORTFOLIO MANAGEMENT to be continued Fast growing new sales CHANNELS and SERVICES Strengthened BALANCE SHEET INNOVATION as a catalyst for further growth Creating value for all METRO GROUP stakeholders 8 September 2015 METRO AG

34 APPENDIX 8 September 2015 METRO AG

35 9M 2014/15: SALES AND EBIT BY DIVISION Δ Sales Like-for-Like EBIT EBIT EBIT 9M 2014/15 9M 2014/15 Change Change reported comparable reported vs 9M 2013/14 million METRO Cash & Carry 22, % 0.9% 9M 2013/ M 2013/14 ~754 9M 2014/ comparable +27 Media-Saturn 16, % 3.2% 205 ~ Real 5, % -0.6% Others/Consolidation METRO GROUP 44, % 1.6% 1,127 ~1,027 1, consecutive quarters with LfL growth; EBIT above PY level if adjusted for FX 4 consecutive quarters with LfL growth; significant EBIT improvement driven by operating leverage and cost control LfL sales impacted by intense competition; EBIT development influenced by targeted marketing investments and costs for store remodellings Others Higher rental costs and lower gains from real estate disposals vs. last year 8 September 2015 METRO AG

36 APPRECIATION OF EBIT Q3 2014/15 in million ~-10 ~ ~60 1) 175 ~30 1) Q3 2013/14 (Reported) Special Items Q3 2013/14 (Before Special Items) Negative FX Impact Q3 2013/14 (Comparable Before Special Items) Q3 2014/15 (Reported) Special Items Q3 2014/15 (Before Special Items) 1) Real Estate Gains from Divestments 8 September 2015 METRO AG

37 METRO CASH & CARRY: HIGHLIGHTS Q3 2014/15 8th consecutive quarter with LfL sales growth Germany improved vs. Q2 despite shift of Easter business Western Europe: Italy and Spain with positive LfL sales growth Eastern Europe: esp. Russia and Turkey with positive LfL sales development Asia: China LfL sales development impacted by giving up low-margin volume business Delivery sales increased by 15% (representing more than 10% of total Cash & Carry sales) 7 new store openings, 2 store closures Sale of METRO Cash & Carry Vietnam on track 0.9 Q1 7.9 Q1 0.8 Q2 9.4 Q2 Like-for-Like Sales Development in % 2013/ / Q3 Q4 2013/ / Q4 Q1 Delivery Sales Share in % Q3 Q1 Q2 Q2 Q3 Q3 8 September 2015 METRO AG

38 METRO CASH & CARRY: STRATEGIC UPDATE Implementation of the New Operating Model to foster entrepreneurship well on track New organizational structure live since 1 July 2015, teams almost fully staffed Pieter Boone took his office as member of the Management Board of METRO AG Countries currently working on the Value Creation Plans (VCPs) together with their Operating Partners (OPs) Full implementation of the New Operating Model by October 2016 Techstars METRO Accelerator well on track METRO Cash & Carry business in Russia under control METRO Cash & Carry Germany Improved development of important HoReCa customer group Upgrading and rebranding of Schaper stores to METRO GASTRO started First promising results from FSD pilot in Weiterstadt 8 September 2015 METRO AG

39 METRO CASH & CARRY: ACQUISITION OF CLASSIC FINE FOODS, AN FSD PLAYER IN THE PREMIUM SEGMENT IN ASIA (III) Deal rationale for MCC Acquire full FSD capabilities Accelerate growth in the HoReCa sector Expand into additional countries Add strong management capabilities Capture additional value through Strengthened access to exclusive assortment Support of international expansion Capture opportunities for selected store operations in new regions Valuation and deal structure Seller: Klassisk Holding Limited (EQT) Share deal Enterprise value of US$290m + earn-out Valuation multiple of 11.6x (EV/2015E EBITDA) in line with peers (MARR 1) 12.3x; Sysco 1) 10.1x) 1) Valuation as at 28 July 2015 based on factset 8 September 2015 METRO AG

40 MEDIA-SATURN: HIGHLIGHTS Q3 2014/15 4th consecutive quarter with positive LfL sales growth Germany impacted by missing sales from FIFA World-Cup last year Western Europe: All major countries grew Eastern Europe: Positive despite Russia suffering from crisis Continued strong growth in online sales of +24% (representing 9% of total Media-Saturn sales) Internet product offering further increased to about 130,000 SKUs at about 120,000 SKUs at 4 new store openings, 5 store closures Like-for-Like Sales Development in % 2013/ / Q1 Q2 Q3 Q4 Q1 Q Online Sales in million 2013/ / Q1 Q2 Q3 Q4 Q1 Q2 1 Adjusted for Redcoon Denmark and France 0.2 Q3 404 Q3 8 September 2015 METRO AG

41 MEDIA-SATURN: STRATEGIC UPDATE Business transformation well on track European market leadership extended by 0.6%pt to 13.4% (highest market share ever!) Market leadership in 9 countries, market share increased in 11 countries Market share gains in all categories All countries contribute to improved operating performance Implementation of electronic shelf labelling (ESL) Further roll-out of city center formats to meet customer needs Ongoing portfolio optimisation (space reductions / store closings) 8 September 2015 METRO AG

42 MEDIA-SATURN LAUNCHES NEW ENTERTAINMENT PORTAL JUKE German launch of JUKE (joint digital entertainment platform) on 3 rd August 2015 Strategic expansion of Media-Saturn s digital business through comprehensive digital offering: >30 million songs >15,000 movies and TV series 1.5 million e-books 2,400 PC games 2,400 PC software applications Free JUKE app pre-installed on various devices and available for download on Google Play and ios App Store 8 September 2015 METRO AG

43 REAL GERMANY: HIGHLIGHTS Q3 2014/ % LfL sales growth over two years Good performance of fruit & vegetables as well as household goods Online sales with strong improvement EBIT with stable development driven by tight cost control and sound margin development in some categories Joint venture with Carlton Investment to further enhance attractiveness and footfall of 10 Real hypermarkets 1 store closure -2.1 Q1 Like-for-Like Sales Development in Germany in % 2013/ / Q2 Q3 Q4 Q1 Q2 Q3 8 September 2015 METRO AG

44 REAL GERMANY: STRATEGIC UPDATE Additional initiatives to further improve performance Service agreement with Markant for complete settlement Striving for in-house collective agreement Commercial Model will drive top-line performance 82 stores already remodeled, 25 to follow in Q4 2014/15 Remodeled stores continue to outperform the other stores by round about 2% Supply chain optimization moving forward 8 September 2015 METRO AG

45 SPECIAL ITEMS million Q3 2013/14 Q3 2014/15 9M 2013/14 9M 2014/15 Portfolio Optimisation Measures Restructuring and Efficiency- Enhancing Measures Goodwill-Impairments Others METRO GROUP September 2015 METRO AG

46 STORES BY DIVISION AND COUNTRY *including 4 stores in the Others segment 8 September 2015 METRO AG

47 CONTACT Investor Relations Metro-Straße Duesseldorf Germany Tel.: +49 (0) Fax: +49 (0) investorrelations@metro.de Internet: 8 September 2015 METRO AG